Energy Changeover in the Autumn Budget of 2024
The UK's 2024 Autumn Budget, announced by Chancellor Rachel Reeves, includes significant updates to planned investments supporting the UK's energy transition and net zero goals.
The government is focused on accelerating the deployment of renewables—offshore wind, onshore wind, and solar—as part of making the UK a clean energy superpower by 2030. This includes ensuring that new low-carbon energy infrastructure benefits local communities through proposals such as a mandatory community benefit fund and facilitating shared ownership of renewable generation infrastructure.
In terms of electric vehicle (EV) chargepoints and transport decarbonisation, the government has introduced measures to reduce red tape around the installation of EV chargepoints starting May 2025. The Treasury committed £2.6 billion of capital investment to decarbonise transport, including £1.4 billion to support EV uptake (vans and HGVs included) and £400 million to support the rollout of charging infrastructure. Other measures include extension of plug-in van grants, grants for electric black cabs, motorbikes, and wheelchair-accessible vehicles, as well as funding for battery gigafactories to boost domestic manufacturing capacity.
The government proposes ending the Energy Profits Levy, which had been applied to oil and gas companies, and is consulting on a new fiscal regime to provide long-term certainty to the oil and gas industry.
To help energy-intensive industries (EIIs) remain competitive and reduce carbon leakage, the government continues support programs such as the British Industry Supercharger, which includes increasing subsidies and exemptions from capacity market and network charges. A review of the Energy-Intensive Industries Compensation Scheme will take place by the end of 2025 to plan continued support post-implementation of the UK Carbon Border Adjustment Mechanism (CBAM) in 2027.
While direct details on Carbon Capture, Utilization and Storage (CCUS) and green hydrogen funding or policies in the 2024 Autumn Budget are not explicitly mentioned, the government's overall strategy to deliver clean power by 2030 implies commitments towards technologies like CCUS and green hydrogen as part of the clean energy superpower mission and energy infrastructure development.
The budget for the Department of Energy Security and Net Zero (DESNZ) increases from £6.4bn in 2023-24 to £14.1bn in 2025-26. Notably, £3.9bn is allocated for Track-1 Carbon Capture, Usage and Storage projects, as well as contracts with 11 green hydrogen producers. The 29% investment allowance for qualifying expenditure, described as "unjustifiably generous", is removed in its entirety from 1 November 2024.
The Energy Profits Levy, initially set to expire on 31 March 2029, is extended until 31 March 2030, and increased from 35% to 38%.
The Scottish government proposes reforms to the public inquiry process for large energy projects, with a consultation on proposed changes to improve the planning system for large energy projects in Scotland, aiming to cut delays, modernize the system, and create a fairer process that involves communities from the outset.
The results of pilot schemes for England's first heat network zones will help inform the government's goal of delivering heat network zoning at scale. Each zone will receive funding from a total of £5.8million allocated to the project.
Gillian Martin, acting cabinet secretary for net zero and energy, supports these reforms as they will help Scotland realize its clean power ambitions. The expansion of UK Export Finance (UKEF) to enable financing support to UK companies supplying critical minerals to exporters in high-growth sectors such as EV battery production and clean growth is also noteworthy.
Construction on each scheme is expected to begin in 2026, and the reforms aim to reduce the average 18-month duration of inquiries and allow for case-by-case decision-making processes. The heat network zones aim to connect large non-domestic buildings, such as hospitals, universities, supermarkets, hotels, and large office blocks. Over £200 million is set for the acceleration of electric vehicle (EV) chargepoints rollout across Britain.
In conclusion, the 2024 Autumn Budget advances the UK’s energy transition with significant investment in clean energy and EV infrastructure, plans to reform fiscal measures affecting oil and gas through the Energy Profits Levy, and ongoing support for energy-intensive sectors facing carbon costs, all aligned with the government’s broader net-zero ambitions. Some specific details on CCUS and green hydrogen funding are not explicitly outlined in the available sources but remain part of the government's strategic clean energy framework.
The government is working towards making the UK a leader in clean energy, including the deployment of renewable sports such as wind and solar. The increased budget for the Department of Energy Security and Net Zero includes funding for Track-1 Carbon Capture, Usage and Storage projects, which could potentially involve sports like green hydrogen production.
